How do the Dutch actually pay - Part I: Peering into people`s wallets

The Dutch are famous for preferring domestic financial services to foreign ones. As many an unsuspecting traveler to the Netherlands has discovered, it can be difficult to buy things without a Dutch debit card. In fact, the Dutch love their own products so much that they even invented their own payments system called iDeal to prevent PayPal from gaining market dominance.

However, things are changing. Financial services are increasingly accessible across international borders, thanks to a combination of technological and regulatory developments.

How will this affect the Dutch market for financial services? Will they adopt foreign financial services, or will they stick with homegrown ones? The Dutch National Bank (DNB) does their own excellent research on payments in the Netherlands. We took a slightly nosier approach, peering into people’s bags and wallets to see what they use and how they use it.

Peering into people’s bags and wallets

We designed and implemented a study of payments in the Netherlands. The first phase was a “portable kit” study in which we interviewed people about the financial products they carry with them when away from home.

The content of a Dutch wallet

We asked people to take every single item out of their bags, wallets, and pockets and lay the items on the table. This included not only finance-related items, but also things like keys, identification, tissues, pens, headphones, and many other items.

First, we asked about their non-financial objects so that we could get a sense of the person. Second, we asked people to talk to us about all their possessions that relate to financial transactions: cash, debit cards, credit cards, store cards, receipts, and tokens. We then asked people to show us what apps and websites they use on their mobile phones to do financial transactions. Finally, we asked questions about how people feel about the role financial services play in the lives, and are likely to play in the future.

Generally, we found people happy to show us their possessions and talk about them. People can understandably be reluctant to talk about money, but we explained up-front that we were not interested in personal information, such as people’s salaries, debt levels, or spending patterns.

An interesting side effect was that during the interviews, people discovered that they were carrying all sorts of things in their wallets and bags that they didn’t need. Several interviewees ended up with piles of items next to them that they planned to discard or store at home, such as receipts, store cards, and discount vouchers. Many a wallet and bag were lighter at the end of the interview than when we started.

Cash isn’t dead, but it’s dying

Interviewees carried very little cash, with amounts ranging from EUR 0-40. Interviewees stated that cash is largely unnecessary, since virtually all commercial outlets in the Netherlands accept debit cards.

“Almost everything is done electronically. I think the only time I really use cash is when I go to the market. And occasionally, I’ll draw money out of the bank and put it in my wallet and that’s kind of my slush fund for the week, of I want something. You know, I’ll go sit and have a coffee somewhere, or you know, disposable cash, if you like.”

Cases where paying in cash was the only option included some market stalls, festivals, beggars on the street, and tattoo shops. Sometimes, people would also pay for small items with cash, even though they know it is perfectly acceptable to pay with card. This is because in the past, shopkeepers did not tend to like it when people paid with card for small purchases.

Using an app to track expenses

Despite stating little need for cash, most of our informants said they would take some cash out of an ATM every couple of weeks, but usually only in small amounts of up to EUR 50. Some interviewees had preferences for where they would make cash withdrawals.

Erin B. Taylor, PhD, is an economic anthropologist and Principal at Canela Consulting. She has designed and lead qualitative research on financial behaviour in the Netherlands, Haiti and the Dominican Republic. Erin co-produced the Consumer Finance Research Methods Toolkit to help professionals adapt to rapid changes in consumers’ financial behaviour.

About Canela Consulting

Canela Consulting is a research consulting firm specializing in financial behaviour and technology use. We work with public and private organizations in research design and implementation, program management, capacity development, evaluation strategies, and stakeholder engagement. We combine expertise in the social sciences with deep technical knowledge and business experience.